CINCINNATI, Ohio — A slowing world economy is beginning to affect the sales growth of life sciences companies.
Last week, Meridian Bioscience Inc. in Cincinnati announced record net sales of $34.3 million for its first fiscal quarter, which ended Dec. 31. However, the company’s quarterly sales growth slowed to only 1 percent from the year-ago quarter, compared with 13 percent growth in the fiscal fourth quarter from a year ago.
“Our sales growth rate for the first quarter was challenged by the weakness of the euro as well as shifts in ordering patterns in both the Diagnostics and Life Science businesses,” John A. Kraeutler, Meridian’s chief executive, said in his company’s Jan. 22 earnings statement.
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Meridian Bioscience makes diagnostic kits, and purified reagents and related products to enable the early diagnosis and treatment of common medical conditions, such as digestive and respiratory viruses. The company also makes technologies that help the drug industry.
Meridian’s balance sheet is strong (the company has no debt) and operating efficiency is robust, Kraeutler said. The company’s first quarter profit margin was 68 percent; its net income, $8.1 million, or 20 cents a diluted share. It’s giving back 17 cents a share to shareholders as dividends. And the Meridian Life Science plant in Tennesssee “produced strong operating income for the first time in five quarters, signaling a recovery of our Life Science business,” Kraeutler said.
The company expects sales growth to pick up later this year. It expects fiscal 2009 sales of between $151 million and $156 million, which ends Sept. 30. That means it expects annual sales growth of between 8 percent and 12 percent.
Steris Corp. in Mentor, which also is in the life sciences business, plans to announce earnings on Tuesday. Elyria’s Invacare Corp., which makes home health care equipment and supplies, has said it would announce fourth quarter and 2008 results on Thursday.
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